Koninklijke KPN (OTCMKTS:KKPNF – Get Free Report) and Liberty Latin America (NASDAQ:LILA – Get Free Report) are both communication services companies, but which is the better investment? We will compare the two businesses based on the strength of their valuation, risk, earnings, profitability, analyst recommendations, institutional ownership and dividends.
Volatility & Risk
Koninklijke KPN has a beta of 0.19, indicating that its stock price is 81% less volatile than the S&P 500. Comparatively, Liberty Latin America has a beta of 0.72, indicating that its stock price is 28% less volatile than the S&P 500.
Institutional and Insider Ownership
18.5% of Liberty Latin America shares are owned by institutional investors. 6.2% of Liberty Latin America shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.
Earnings and Valuation
This table compares Koninklijke KPN and Liberty Latin America”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Koninklijke KPN | $6.59 billion | 2.71 | $967.35 million | $0.26 | 17.65 |
| Liberty Latin America | $4.44 billion | 0.34 | -$611.20 million | ($0.49) | -15.84 |
Koninklijke KPN has higher revenue and earnings than Liberty Latin America. Liberty Latin America is trading at a lower price-to-earnings ratio than Koninklijke KPN, indicating that it is currently the more affordable of the two stocks.
Analyst Ratings
This is a breakdown of recent recommendations and price targets for Koninklijke KPN and Liberty Latin America, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Koninklijke KPN | 0 | 1 | 0 | 1 | 3.00 |
| Liberty Latin America | 2 | 1 | 1 | 0 | 1.75 |
Liberty Latin America has a consensus price target of $10.00, suggesting a potential upside of 28.87%. Given Liberty Latin America’s higher probable upside, analysts plainly believe Liberty Latin America is more favorable than Koninklijke KPN.
Profitability
This table compares Koninklijke KPN and Liberty Latin America’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Koninklijke KPN | 15.09% | 26.07% | 7.10% |
| Liberty Latin America | -2.20% | -9.29% | -0.81% |
Summary
Koninklijke KPN beats Liberty Latin America on 10 of the 15 factors compared between the two stocks.
About Koninklijke KPN
Koninklijke KPN N.V. provides telecommunications and information technology (IT) services in the Netherlands. It operates through Consumer; Business; Wholesale; and Network, Operations & IT segments. The company offers fixed and mobile telephony, fixed and mobile broadband internet, and television services to retail and business consumers; infrastructure and network related IT solutions to business customers; and wholesale network services to third parties. It also provides IT services, including cloud, workspace, and cybersecurity services; interconnect traffic, visitor roaming, and digital products; and NL-ix, an interconnect exchange, as well as sells handsets, peripheral equipment, and software licenses. In addition, the company offers virus and malware scanners; anti-virus licenses; 1Password, a password management tool; DNSSEC, a technology that prevents customers from being led to fake websites; KPN Veilig Netwerk Thuis, a smart network security; Censornet, which includes web security, cloud application security broker, email protection, and awareness training; SuperVision, which provides digital governance solutions for workspaces; and OneMonitoring to ensure early detection of cyber incidents. Further, it provides fiber networks; and IT services for integrating healthcare systems and optimizing communication between healthcare providers. The company distributes its products and services under the KPN, XS4ALL, Simyo, KPN Security, KPN Health, Solcon, Inspark, and KPN Partner Network brands. The company was formerly known as Koninklijke PTT Nederland NV and changed its name to Koninklijke KPN N.V. in June 1998. Koninklijke KPN N.V. was founded in 1881 and is headquartered in Rotterdam, the Netherlands.
About Liberty Latin America
Liberty Latin America Ltd., together with its subsidiaries, provides fixed, mobile, and subsea telecommunications services. The company operates through C&W Caribbean, C&W Panama, Liberty Networks, Liberty Puerto Rico, and Liberty Costa Rico segments. It offers communications and entertainment services, including video, broadband internet, fixed-line, telephony, and mobiles services to residential and business customers; and business products and services that include enterprise-grade connectivity, data center, hosting, and managed solutions, as well as information technology solutions for small and medium enterprises, international companies, and governmental agencies. The company also operates a sub-sea and terrestrial fiber optic cable network that connects approximately 40 markets. It provides its services under the brands of C&W, Liberty Costa Rica, Liberty Communications, BTC, Flow, and Mas Móvil. The company was incorporated in 2017 and is based in Hamilton, Bermuda.
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